- 2024-10-24T00:00:00
- Company Research
ACB released its 9M 2024 results, reporting TOI of VND25.0tn (USD998mn; 2.4% YoY) and PBT of VND15.3tn (USD613mn; +2.1% YoY), with both figures completing 69% of our full-year forecasts. On a QoQ basis, Q3 2024 TOI and PBT decreased by 6% and 13%, respectively. We attribute the 13% QoQ decrease in Q3 2024 PBT to (1) the weaker-than-expected NOII which decreased 19% QoQ, and (2) a 19% QoQ increase in operating expenses, which outweighed a 39% QoQ decrease in provision expenses. We see potential downside to our current earnings forecasts, pending a more extensive review.
9M 2024 credit growth was 13.8% (vs the bank credit quota of 18.4%) and higher than the system-wide credit growth of 9%. However, Q3 2024 credit growth slowed down compared to Q2 2024 credit growth.
9M 2024 deposit growth was 6.1% - much lower than the credit growth. Instead, ACB mobilized funds through valuable papers in Q3 2024, which increased 35% QoQ to VND90tn. This resulted in a decrease in regulated LDR to 80.4% in Q3 2024 vs 82.4% in Q2 2024 – per our estimation. ACB’s Q3 2024 CASA ratio was flat QoQ at 21.6%.
9M 2024 NIM was 3.77%, decreasing 30 bps YoY vs our full-year forecast of 3.84%. On a QoQ basis, ACB’s NIM decreased 25 bps QoQ to 3.63% in Q3 2024. We attribute this to (1) ACB reducing lending rates under weak credit demand by retail customers and high competition between banks, and (2) a higher proportion of short-term loans compared to Q3 2023. Additionally, ACB’s COF ticked up by 29 bps QoQ to 3.58% in Q3 2024 following the increase in deposit rates since the beginning of H2 2024.
9M 2024 NOII was VND4.2tn (-25.6% YoY), completing 58% of our full-year forecast due to (1) low income from recovery of bad debts with other income decreasing 37.2% YoY, (2) weak investment income (-81.6% YoY), and (3) low gains from FX trading activities (-23.5% YoY) that outweighed (4) an increase in pure NFI (+8.0% YoY).
9M 2024 OPEX was well-controlled with a CIR of 32.7% (flat YoY).
ACB’s NPL ratio of 1.49% was relatively flat compared with the previous quarter. In addition, ACB’s Q3 2024 provision expenses decreased 31.2% YoY and 39.1% QoQ with the LLR ratio increasing 2.7 ppts QoQ to 80.5%. We believe ACB’s asset quality has shown a trend of improvement.
ACB’s consolidated 9M 2024 results
VND bn | 9M 2023 | 9M 2024 | YoY | Q3 2023 | Q3 2024 | YoY |
NII | 18,670 | 20,714 | 11.0% | 6,209 | 6,881 | 10.8% |
Non-interest income | 5,698 | 4,242 | -25.6% | 2,215 | 1,255 | -43.4% |
OPEX | (7,861) | (8,163) | 3.8% | (2,868) | (2,934) | 2.3% |
PPOP | 16,507 | 16,793 | 1.7% | 5,556 | 5,202 | -6.4% |
Provision expenses | (1,483) | (1,459) | -1.6% | (521) | (358) | -31.2% |
NPAT-MI | 12,038 | 12,244 | 1.7% | 4,038 | 3,870 | -4.1% |
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Loan growth** | 8.7% | 13.8% | 5.1 ppts | 3.6% | 0.9% | -2.7 ppts |
Deposit growth** | 7.6% | 6.1% | -1.5 ppts | 3.0% | 0.1% | -2.9 ppts |
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NIM | 4.07% | 3.77% | -30 bps | 3.98% | 3.63% | -35 bps |
Interest-earning asset yield | 8.69% | 6.81% | -188 bps | 8.35% | 6.81% | -154 bps |
Cost of funds | 5.20% | 3.42% | -178 bps | 4.94% | 3.58% | -136 bps |
CASA ratio* | 20.6% | 21.6% | 96 bps | 20.6% | 21.6% | 1.0 ppts |
CASA ratio plus term deposits in FX | 21.7% | 21.8% | 16 bps | 21.7% | 21.8% | 0.1 ppts |
CIR | 32.3% | 32.7% | 45 bps | 34.0% | 36.1% | 2.1 ppts |
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NPLs / Gross loans | 1.21% | 1.49% | 28 bps | 1.21% | 1.49% | 28 bps |
Group 2 loans / Gross loans | 0.82% | 0.63% | -19 bps | 0.82% | 0.63% | -19 bps |
Accrued interest / IEAs | 0.63% | 0.51% | -12 bps | 0.63% | 0.51% | -12 bps |
Source: ACB, Vietcap — *CASA volume included demand deposits and margin deposits; ** Q3 2023 and Q3 2024 loan and deposit growth is QoQ growth.
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